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HOT SULPHUR SPRINGS - Grand County commissioners are in the throes of hearings over whether to approve a 1041 permit for the Windy Gap Firming Project.

Working through a list of 32 conditions for the permit, representatives from the Northern Colorado Water Conservancy District sat before commissioners in the boardroom of the Grand County Administration Building on Tuesday, along with Grand County's water counsel, and hashed out wording of each of the conditions in search of agreements among stakeholders.

It's the second official gathering on the county's 1041 authority over the project, a hearing that was continued to Nov. 8. Parties are aiming to conclude hearings with a county decision about whether to grant the permit by the end of the year. A 1041 permit allows the county to place conditions on activities designated as matters of state interest.

Aside from disagreements about three different monitoring plans mentioned in conditions of the permit, at least one other condition remains a sticking point - a condition involving the clarity of Grand Lake.

The county has proposed a condition stating the permit for the Windy Gap Firming Project will not go into effect until a federal plan, on course to include a National Environmental Policy Act process, is in place - charting the way toward a solution of the Grand Lake clarity problem.

Grand County Commissioner Gary Bumgarner put pressure on Northern representatives during Tuesday's hearing about needed "assurances" that a solution will be realized for Colorado's largest natural water body. Bumgarner advocated for language "that holds feet to the fire."

But Northern representatives objected to the project's 1041 permit being conditional upon a long federal process concerning Grand Lake's clarity problem.

Eric Wilkinson, general manager of the Northern Colorado Water Conservancy District, said it was a matter of "authority and responsibility." The municipal subdistrict seeking to firm up rights to Windy Gap water "doesn't have the authority to control the other entities involved in the clarity issue," he said. "It puts them in a position of being responsible without the authority to do something."

Wilkinson pointed out that Northern has budgeted $2.58 million for over the next five years as a "token of commitment" on the clarity issue to "try and move this entire effort to a solution." Northern officials objected to the Windy Gap permit - and therefore the entire project - potentially being tied up in the clarity situation that involves the Bureau of Reclamation as the owner of the Colorado-Big Thompson Project.

In August, the Bureau released a report that discussed possibilities for addressing the issue, such as pumping modifications, a water bypass around Grand Lake with a buried pipeline, deepening Shadow Mountain Reservoir as a solution to the algae problem or removing the reservoir dam, watershed improvements and a capture of water from Grand Lake to divert it directly into the Adams Tunnel.

The next step in the process is a technical review starting this fall, according to Kara Lamb, spokesperson for the Bureau of Reclamation. The review will include a work plan that will outline engineering designs, developing costs, and environmental compliance of alternatives, the latter of which would involve a public NEPA scoping process.

"We're moving through a long series of steps," Lamb said.

Concerning another condition on the Windy Gap bypass, the county proposes the "bypass/bythrough study shall commence on or before issuance of this 2012 permit" and if the study deems it, construction of the bypass "shall proceed" with cooperation on financing it among the parties.

A 2011 Colorado Parks and Wildlife report by Barry Nehring concluded that the Colorado River below Windy Gap has suffered due to the reservoir, and that creating a bypass would be a solution.

"The problems of channel armoring and chronic sedimentation and clogging of the interstitial spaces in the cobble-rubble dominated riffles areas has been ongoing in the upper Colorado River basin for more than half a century," the report reads. "These proposed firming projects at Windy Gap and the Moffat Tunnel are only going to further exacerbate this situation. Two things must be done if there is to truly be any hope of enhancement of aquatic ecosystem in the upper Colorado River in the future. A bypass channel around Windy Gap Dam and a major investment in stream channel reconfiguration for the Colorado River below Windy Gap Dam are both equally important and the only way true enhancement has any possibility of success. Either one without the other will have virtually no chance of succeeding."

Yet no party knows yet how much a bypass around the reservoir might cost or where the money would come from.

The Subdistrict has agreed to provide $250,000 toward research of a bypass, which is expected to reduce high temperature events caused by the dam, reduce sedimentation deposition, restore river connectivity, and reduce the impacts of whirling disease.

About $3 million in funds - $2 million by Northern and possibly $1 million by Denver Water if negotiations are successful - would be available to construct the bypass and the construction would take place immediately after the study finds that the bypass would be beneficial to the river. There is the possibility another $2 million could be found from Colorado Parks and Wildlife.

Northern officials so far have agreed with the way the condition concerning the bypass is currently written in 1041 proceedings. If all the funding hasn't been reached, the concerned parties would regroup and "work together to get the funds," according to Grand County Manager Lurline Underbrink Curran.

But the Colorado River Alliance and Trout Unlimited have contended that Northern should come up with additional funds if there is a funding shortfall for the bypass, and the way the condition is written at present is not satisfactory to them.